Crown Castle to buy rights to AT&T towers for $4.85 billion
(Reuters) - Wireless infrastructure provider Crown Castle International Corp (CCI.N: Quote) said on Sunday that it had agreed to buy rights to about 9,700 AT&T Inc (T.N: Quote) wireless communication towers for $4.85 billion in cash.
Under the agreement, Crown Castle will purchase some 600 towers and have the exclusive right to lease and operate around 9,100 AT&T towers for a weighted average term of about 28 years.
The company will have the option to purchase the towers at the end of the lease terms for option payments of around $4.2 billion.
Crown Castle expects to fund the transaction with cash on hand, equity and debt financing, including borrowings under its revolving credit facility.
"Consistent with our focus on the top 100 US markets, nearly half of the AT&T towers are located in the top 50 markets, where we expect the majority of network densification and upgrade activity to occur.
The deal is expected to close by the end of the year.
AT&T, the No. 2 wireless carrier in the United States, had said last month that it was exploring the sale of its towers but that its ability to reach a deal would depend on the terms it is able to reach with the buyer for its ongoing use of the towers.
When wireless service providers sell broadcast towers they typically lease back space from tower operators so they can continue to offer their services without interruption
"This deal will let us monetize our towers while giving us the ability to add capacity as we need it," said Bill Hogg, Senior Vice President — Network Planning and Engineering, AT&T Services Inc. Continued...